CNOOC 2011 profit up 29 percent on oil sales

AP News
Posted: Mar 28, 2012 11:23 PM
CNOOC 2011 profit up 29 percent on oil sales

CNOOC Ltd., one of China's three major state-owned oil producers, said Thursday its 2011 profit rose 29.1 percent on higher oil and gas sales.

Profit rose to 70.3 billion yuan ($11.3 billion), or 1.59 yuan (26 U.S. cents) per share, on a 29.5 percent increase in oil and gas sales to 189.3 billion yuan ($30.5 billion), the Beijing-based company reported.

CNOOC, China's main offshore oil and gas producer, has benefited from its focus on production rather than retail sales. It sells crude at global market prices, while government controls that hold down retail prices have squeezed rivals PetroChina Ltd. and Sinopec Ltd., which operate filling stations in addition to production and refining units.

CNOOC said oil and gas production in 2011 rose marginally to the equivalent of 331.8 million barrels of crude. Its realized oil price rose 40.8 percent over the previous year to $109.75 per barrel.

CNOOC suffered a public relations setback when oil leaks at a field operated by an American partner, ConocoPhilips Co., in the Bohai Bay off China's northeast caused an outcry over environmental damage.

Production at the field was temporarily suspended.

"In the year of 2011, we were confronted with unprecedented difficulties," said CEO Li Fanrong in a statement, referring to the spill.

Despite that, Li said, "We have made a number of breakthroughs in exploration, development and overseas business."

CNOOC said two new projects commenced operation in 2011 and 16 are under development.